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NTMA raises €1 billion in bond auction

The National Treasury Management Agency has completed an auction of €1 billion of benchmark 10-year Irish Government Bonds.

The bonds, which mature in 2024, were sold with an interest rate paid to investors of 2.917%.

The NTMA has raised €5.75 billion in the bond markets so far this year which is more than 70% of its funding target of €8 billion for the full year.

Today’s auction received 2.8 times more bids than was needed to complete the auction.

The NTMA returned to regular bond auctions on March 13, following a three and a half year hiatus from bond auctions while it was under the protection of the EU/IMF bailout.

Ireland sold €1 billion of the bonds in its first such tender which will pay the investors a yield of 2.9%, the lowest on record for a 10 year auction.

Minister Noonan said the sale "highlights the progress that has been made in fully restoring market access".

Alan McQuaid, economist with Merrion Capital Group, said: "With another €1 billion tap of its benchmark March 2024 bond and a lower yield than the previous auction, the sale is very positive. We’re now in a very comfortable position, and this will help keep Irish bond yields lower relative to other peripherals".

The NTMA has been raising debt periodically for over two years through debt swaps and syndicated issues, a strategy that has been copied by Portugal which hopes to follow Ireland out of its bailout next month.